What We Learned From Global Eagle Entertainment’s Investor Presentation


What We Learned From Global Eagle Entertainment’s Investor Presentation

Global Eagle Entertainment (NASDAQ: ENT) is a provider of aircraft connectivity systems. Specifically, the company airlines and its passengers with Wi-Fi connectivity over satellite transmissions. Licensed media content, including video and music programming is offered to passengers.

On Tuesday, Global Eagle’s management team provided a presentation of its business and outlook at a Dougherty Investment Conference.

Global Eagle’s stock has been out of favor with investors and has lost more than 17 percent since the start of 2016 and nearly 30 percent over the past year. A presentation at an industry conference represents an ideal opportunity to present the investment case for a company’s stock.

First, Global Eagle noted the very large size of the market it faces, including connection in 21,000 aircrafts, 28,000 business and private jets, 158,000 cabins in cruises, 13,000 yachts, 130,000 ships, among others.

The company went on to project its aviation connectivity market to grow at 20 percent, its content market to grow at eight to 10 percent and its maritime market to grow at 10 to 15 percent.

Global Eagle has a deep relationship with many studios for content, including the more notable names such as Warner Brothers and Walt Disney. Television partners also include notable names such as CNN, CBS and even holds the rights to broadcast the Olympic games.

Global Eagle added that advertising revenue represents a “virtually untapped” potential. Specifically, the company will sell digital ads, video ads and “virtual live channels.”

The company has a cost synergy realization plan underway which will result in $15 million in savings in 2017 but will more than double to $40 million in 2018.

Finally, the company boasted its track record as of late, including 10 acquisitions, some of which allowed for entry into new markets. Global Eagle is also being led with a deep management team with experience in global integrations.

Despite an overall optimistic tone its presentation, Global Eagle’s stock was little changed following its presentation and was trading higher by around 0.50 percent.

The next notable event for Global Eagle that can act as a catalyst for the stock would be its next quarterly earnings report. However, the company last reported its earnings in early August so its next earnings print isn’t expected until early November.